Home Loan Tax Benefit Calculator

Home loan tax relief is the most over-quoted number in Indian property sales. Two deductions matter: Section 24(b) on interest, capped at ₹2,00,000 a year for a self-occupied house, and Section 80C on principal repayment plus stamp duty, inside the shared ₹1,50,000 limit.

The catch almost nobody mentions: under the new tax regime — the default since FY 2023-24 — neither is available for a self-occupied property. If you have not actively opted for the old regime, your home loan tax saving is very likely zero. Switch the regime below and watch the number collapse.

The two deductions

The regime trap

Since FY 2023-24 the new regime is the default. It offers lower slab rates but removes almost all deductions, including 24(b) on a self-occupied house and the whole of 80C. You must opt out into the old regime to claim them. For a let-out property, interest remains deductible against rental income even in the new regime, though the loss cannot be set off against salary.

A worked example

₹4,00,000 interest and ₹1,20,000 principal, 30% slab, ₹50,000 of 80C already used, self-occupied, old regime: Section 24(b) is capped at ₹2,00,000, and 80C takes ₹1,00,000 of the remaining room. Total deduction ₹3,00,000 → tax saved ₹93,600 including cess. On the new regime the same loan saves ₹0.

Section 80EEA (an extra ₹1.5 lakh of interest) applied only to loans sanctioned between 1 April 2019 and 31 March 2022 and is not available on new loans. This calculator excludes it deliberately.

On the section numbers. "24(b)" and "80C" are numbers from the Income-tax Act, 1961, which the Income-tax Act, 2025 replaced on 1 April 2026. The Ministry of Finance describes the new Act as a re-drafting "without altering the underlying tax policy", so the ₹2,00,000 interest cap, the ₹1,50,000 combined limit and the regime rules above are unchanged — but if you are citing a section in a filing, take the current number from the Act itself rather than from this page. Checked 20 September 2026.

Tax saved on a home loan, by loan size (old regime)

Section 24(b) allows up to ₹2 lakh of interest a year on a self-occupied home, and 80C up to ₹1.5 lakh of principal. Both are caps, so past a certain loan size a bigger loan saves you nothing more in tax.

Old regime only — the new regime allows neither deduction on a self-occupied property, which is the single biggest reason to compare the two. The 80C figure assumes the full ₹1.5 lakh is used, and it competes with EPF, insurance and ELSS in the same limit. A let-out property has no ₹2 lakh interest cap but is taxed on its rent.

Frequently asked questions